Frugal Investing – What Is It Exactly?

Living frugally involves spending your money carefully while investing means taking risks. And how are those two going to go together? Investing in almost everything on earth will backfire, and leave you worse off than before.

With that, investing and frugal living has a lot of unexpected things in common. Those who implement a frugal, careful lifestyle can be the world’s smartest and most rewarded investors.


Frugal investing is based on conserving and increasing your capital. It means prioritizing financial growth over a lavish lifestyle by making calculated decisions that allow you to increase your wealth even further.

Frugal Investing - What Is It Exactly?

Find Money to Invest

Cut expenses, or generate more money. If you free up some amount of money from your budget and have paid off urgent debts and set up an emergency fund, then each month, you can start investing that extra money.

Making more revenue would be more effective in the long run if achieved in combination with lowering expenses and increasing revenue by spending your time on secondary growth. 


You can do this by having a second job, starting a blog, marketing your creations on Etsy, and reselling thrift clothes on eBay, you could make more money.

Frugal investors have no debts and noticeable drains on their capital. If you struggle to get along with the fundamentals, then concentrate on saving more and spending less. Only then can you manage to put your hard-earned money into investments that work.

With more money being earned, you get to invest more. The more you invest wisely, the more yields you will see on your account. In the end, what and how you invest is up to you.


Start Investing

Investing is putting your money into financial schemes, stocks, assets, or a business venture with the explicit purpose of earning.

Before you start investing, make sure you conduct a lot of well-informed research. You can start by contacting a financial advisor, or go directly via a secure online trading channel.

If you’re a frugal person, you’ll appreciate the value of doing it one move at a time – it’s best to have a systematic approach.

It is time to choose your industry after getting enough knowledge. Many people are investing small sums of money in stocks until they get the hang of it.

Calculate Opportunities

If you want to invest but are frugal at heart and don’t like taking risks, there is a level of calculation to do. Investing does, of course, present a financial risk.

This is true, especially if you put a lot of money into one investment. Smaller investments for years can also best serve frugal people, guaranteeing that there are no significant losses.

Of course, you can seek advice from a financial advisor if you are completely new to any investment type. Consulting is usually free, and consultants can be sought through your banking institution.

Frugal Investing - What Is It Exactly?
Image source: Sage Investment Management

The Bottom Line

There are lots of finance blogs out there, and there are plenty of contrasting pieces of advice on how to handle and invest your cash. They’re not all right or wrong – what’s crucial is that you make sound decisions.

It can take longer for your savings to return. This is one thing that frustrates first-timers; investing doesn’t mean you’ll have a get-rich-quick answer.